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Columns

Here's a holiday feast of housing hoaxes

With the holiday season's arrival this Thursday, let's welcome a festive break from the housing doldrums.

By James Thorner, Times Staff Writer
Published November 19, 2007


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With the holiday season's arrival this Thursday, let's welcome a festive break from the housing doldrums.

But before we do, let's assemble a list of the rogues and dupes who have made the real estate market such an unwholesome place for the holidays.

You're behind on your house payment. A postcard arrives in the mail. A company promises to fix your foreclosure for $1,200. One condition: Don't call your lender. The foreclosure fixers will handle everything.

Who could refuse such an offer? The company must have spent at least a quarter on postage. Many people forked over $1,200. How did it work out? Let's say quite a few homeowners are now not-so-happy renters.

The TV show Inside Edition savaged one of those self-proclaimed rescuers, Clearwater's Foreclosure Assistance Solutions. Nothing says subtlety like the juxtaposition of homeless customers with the owner's $2-million waterfront mansion.

A special niche in the rogue's gallery goes to the people who manipulated the market at The Club at Brickell, a 43-story condo tower in Miami. They committed deception on such a scale that bankers are calling it a national epicenter of mortgage fraud.

Phony appraisals and lax underwriting let crooks arrange sales of $400,000 condos for $800,000. The cheaters paid the sellers $400,000 per condo, cashed out the remaining $400,000 and let the empty condo fall in foreclosure. Investigators said about 200 of the deals were shady. Wonder why Florida leads the nation in mortgage fraud?

Stick the next case in the dumb-as-a-sheet-rock file. Trans-eastern Homes, operating in Tampa as Engle Homes, is one of the builders lanced by bankruptcy rumors this month. Here's one reason: Transeastern was notorious for its high-pressure, cattle-call sales events. At one event at Saddlebrook Resort in Wesley Chapel, if you didn't sign up for a home quickly, you'd be exiled to the rear of the line.

The ploy came back to bite the company. So eager was Transeastern for fast sales, it lost money on many transactions. Construction costs rose and the company couldn't renegotiate home sale prices they locked in.

We could fill the list with more examples, but that's plenty for now. Must leave room for pie.

[Last modified November 16, 2007, 21:56:27]


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